Failing Health Care Co-ops Will Cost Taxpayers

Consumer Operated and Oriented Plan Programs (COOPs) were really a political compromise between Members of Congress who wanted a public plan option and those who didn’t. Once the Affordable Care Act passed, COOPs had outlived their usefulness. However, they are now failing and will cost taxpayers plenty. Senior Fellow Devon Herrick testified before a congressional committee.

A Spending Reality Check

The latest CBO figures show that far from declining as a share of GDP, federal discretionary spending between FY 2000 and FY 2001 grew almost as fast as the economy. And the CBO's unofficial estimate is that federal spending between FY 2001 and FY 2002 will grow almost twice as fast as the economy! "On-budget" surpluses (non-Social Security and non-Medicare) are, it appears, gone for good. That's highly unfortunate because on-budget surpluses, indeed, massive on-budget surpluses, are critical to paying scheduled Social Security and Medicare benefits over time. Stated differently, the two programs' short-term off-budget surpluses fall far short of the extra funds they need to deal with their own long-term benefit commitments.